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Uncompensated care pools and care to the uninsured: lessons from the New York Prospective Hospital Reimbursement Methodology.

One policy response to both the growing number of uninsured and the increased volume of uncompensated care is the development of revenue pools to explicitly finance uncompensated care. Despite the growing popularity of this response, few analyses have examined their success in financing uncompensated care and improving access to the uninsured. This study examines one such program developed as part of New York State's all-payer rate-setting system. The results indicate that the revenue pools improved the financial condition of New York hospitals but were less effective in improving access to care by the uninsured. The latter result was traced to the method selected by New York to measure "need" and distribute payments to hospitals. If the goal of such programs is to earmark payments to the uninsured, methods other than the New York system should be employed.

Data Collection

Universal access to health care. A comprehensive tax-based approach.

More than 30 million Americans lack health insurance, and millions more are "underinsured." Meanwhile, the cost of health care in the United States is escalating, and some of our care is of questionable value. This article presents a health care reform strategy that addresses these three fundamental problems in the US health care system. The strategy, designed to empower consumers to make cost-conscious health care choices, combines a universal tax credit that enables all Americans to purchase basic health coverage; insurance reforms including pooling and reinsurance mechanisms; requirements that all employers make insurance available to their employees and that all consumers purchase coverage; and efforts to measure and improve the quality and efficiency of health care services. This strategy would help us to achieve universal health insurance coverage, while creating the proper incentives for cost control. In addition, it can be largely internally financed through savings automatically triggered by its implementation.

Cost Control

Antitrust, competition, and health care reform.

The goals of health care reform and the antitrust laws are similar: promotion of consumer welfare. Under reform, having large groups of consumers and providers will offer substantial efficiencies in purchasing and providing health care services but also will pose some antitrust risks. Health alliances may have excessive market power. Health plans and provider networks may have the potential to foreclose competition from actual or potential rivals. Mergers and joint ventures between providers will proliferate but may raise similar problems. Explicit exemptions from the antitrust laws-through federal or state legislation-may significantly limit the benefits of competition for consumers. A reformed health care system will not reduce the need for antitrust enforcement.

Antitrust Laws

A single-payer system in Jackson Hole clothing.

President Clinton's Health Security Act relies on government regulation, not market forces, to control costs. The act creates an entitlement to comprehensive benefits and places the federal budget at risk for total health care costs in order to achieve universal coverage; it creates a system of new state purchasing monopsonies; and it attempts to control costs with price controls on health plan premiums, set and administered by a National Health Board that would be part of the executive branch, not insulated from political considerations. We believe there is a better way.

Cost Control

Implicit pooling of workers from large and small firms.

Risk pools for small employers have become an integral part of proposals for national health care reform and have been implemented by a number of states. These explicit attempts to pool small employers are occurring at the same time that many small-firm employees obtain health insurance through implicit pooling arrangements as the dependent of a policyholder insured by a large firm. We use data from the 1987 National Medical Expenditure Survey to document the extent of implicit pooling arrangements, to examine whether small-firm employees and their dependents are adverse health risks, and to assess the cost implications of pooling small- and large-firm employees and dependents.

Cost Control

Alternative volume performance standards for Medicare physicians' services.

The Omnibus Budget Reconciliation Act of 1989 (OBRA89) established volume performance standards (VPSs) as a key element in Medicare physician reform. This policy requires making choices along three dimensions: the risk pool, the scope and nature of the standard, and the application of the standard. VPSs have most effectively controlled expenditures and changed physician behavior when they use states as the risk pool, are composed entirely of Medicare Part B services, and establish per capita utilization targets. The institution of separate standards for voluntarily formed physician groups would pose substantial administrative challenges and has the potential to effect adverse outcomes. Instead, Congress should continue to encourage prepaid plans for the purpose of lowering health care use. Under current law, VPSs will be used to adjust future price increases. Congress may not wish to emulate the example of countries that have imposed expenditure ceilings to control costs unless the current method of using VPSs proves unsuccessful.

Canada

Ribonucleotide reductase activity of synchronized KB cells infected with herpes simplex virus.

The replication of herpes simplex virus (HSV) is unimpeded in KB cells which have been blocked in their capacity to synthesize deoxyribonucleic acid (DNA) by high levels of thymidine (TdR). Studies showed that the presence of excess TdR did not prevent host or viral DNA replication in HSV-infected cells. In fact, more cellular DNA was synthesized in infected TdR-blocked cells than in uninfected TdR-blocked cells. This implies that the event which relieved the TdR block was not specific for viral DNA synthesis but allowed some cellular DNA synthesis to occur. These results suggested that HSV has a means to insure a pool of deoxycytidylate derivatives for DNA replication in the presence of excess TdR. We postulated that a viral-induced ribonucleotide reductase was present in the cell after infection which was not inhibited by thymidine triphosphate (TTP). Accordingly, comparable studies of the ribonucleotide reductase found in infected and uninfected KB cells were made. We established conditions that would permit the study of viral-induced enzymes in logarithmically growing KB cells. A twofold stimulation in reductase activity was observed by 3 hr after HSV-infection. Reductase activity in extracts taken from infected cells was less sensitive to inhibition by exogenous (TTP) than the enzyme activity present in uninfected cells. In fact, the enzyme extracted from infected cells functioned at 60% capacity even in the presence of 2 mm TTP. These results support the idea that a viral-induced ribonucleotide reductase is present after HSV infection of KB cells and that this enzyme is relatively insensitive to inhibition by exogenous TTP.

Carbon Isotopes

Financial risk, accountability and outcome management: using data to manage and measure clinical performance.

As health care reform and components of managed competition begin to infiltrate the health care system, health care providers will be facing significant challenges over the next several years in responding to priorities that mandate the delivery of appropriate, comprehensive, cost-efficient high quality care. Changes in financial risk, increasing accountability, performance documentation, and outcome measurements will hold providers more responsible for the input and output of services provided. In an effort to respond to these challenges, health care providers will have to rely on integrated data systems to identify opportunities for improvement in an effort to more effectively manage and measure the impact of health care delivery as patients move through the health care system.

Competitive Medical Plans